The new face of corporate activism in Hong Kong? Firms grapple with how much is too much

In December, a pair of rainbow lions installed outside a bank caused a stir in Hong Kong.

LGBTI activists applauded HSBC for refusing to bow to pressure from local family groups to remove the colourful statues, which represented its “Celebrate Pride, Celebrate Unity” campaign, from outside its headquarters in Central. The bank stood its ground despite accusations it had threatened family values by altering its iconic lions Stephen and Stitt.

At the time, a bank spokeswoman said the lions were an important symbol of the company’s commitment to diversity.

“Having a workforce that reflects the diversity of our millions of customers in Hong Kong and which draws on a wide range of perspectives makes us better able to serve the whole community,” she said.

Fern Ngai, chief executive of local non-profit organisation Community Business, which works with companies to advance responsible and inclusive business practices, said the move marked a victory for corporate activism in the city.

“We applaud HSBC’s strong commitment to diversity and inclusion with its rainbow lions, which were placed on one of the busiest streets in Central,” she said. “Generally in Hong Kong, corporate activism is not very prominent in the business sector. Companies tend to be more traditional and stick to business rather than use their businesses as a platform for social change, especially on issues that are potentially seen as politically charged or controversial such as LGBTI rights.”

Despite praise from activists, the campaign lost HSBC some supporters locally; Hong Kong remains broadly conservative in its approach to LGBTI issues.

Nonetheless, David Webb, a former investment banker who now analyses the activities of Hong Kong’s corporations and collates reports at Webb-site.com, said HSBC had been wise to ignore the protests from some family groups, because promoting LGBTI issues forms part of its corporate values, which shareholders would expect it to uphold.

“I see nothing wrong with HSBC allowing these exhibits on its property,” he said. “The ‘family values’ of their opponents apparently include intolerance and bigotry. Like any other company, HSBC’s management and board have a fiduciary duty to act in the best interests of their shareholders to maximise long-term value. That may well include supporting worthwhile causes consistent with its behaviour as an employer and service provider. It would be pretty shocking if they did the opposite.”

But Webb added he did not see the rainbow lions installation as an example of intentional corporate activism, and that in general Hong Kong corporations remained reluctant to be seen to be campaigning on social issues.

“I do not think there is much corporate activism here at all,” he said. “Through the functional constituencies in the Legislative Council, corporates have great power, so they don’t need to lobby in this way.”

Professor Carlos Lo Wing-hung, director of the management sustainability research centre at Polytechnic University, said he agreed Hong Kong was still “lagging behind” in terms of corporate activism.

“The culture in Hong Kong is quite Westernised but we can see behind that it is quite selective; it is still quite family-based and it puts that over individualism. Corporates still need to feed into the cultural conduct here. We cannot put the city on the same cultural foundations as London or New York. That is the reality whether we like it or not.”

Lo said, however, that he had seen evidence of companies demonstrating greater corporate social responsibility (CSR), which he attributed to growing local and international institutional pressure.

Polytechnic University announced the results of its second Hong Kong Business Sustainability Index on December 29.

The average score of the 50 constituent companies of the Hang Seng Index was 45.73 (out of 100 points), an increase of 9.53 per cent compared with the first study in December 2015.

The Business Sustainability Index aims to encourage listed companies to adopt CSR as a progressive business model to achieve sustainability, the university said.

“I think Hong Kong companies have been doing quite well in that regard,” Lo said. “They have established good strategies to improve CSR.”

ENVIRONMENTAL CAMPAIGNS

In May last year, budget airline HK Express became the city’s first airline to ban shark fin cargo, following international pressure from wildlife campaigners. At the time, HK Express chief executive Andrew Cowen said he felt it was important for firms to take action on social issues they felt committed to supporting.

“It is easy for an airline to claim to be environmentally conscious and a good corporate citizen, but not do very much in fact to demonstrate this,” he said.

The move was soon followed by Cathay Pacific and Dragonair after immense public pressure, and on Friday Air China said it would be the first mainland carrier to impose a ban.

Alex Hofford, WildAid’s campaign manager in Hong Kong, said all airlines had to be increasingly mindful of their customers’ values in order to retain them, and Hong Kong could not avoid the issue.

“Passenger airlines are highly susceptible to negative publicity and the threat of consumer boycotts,” he said. “Nowadays, the public better understands the crisis facing sharks and is getting more ecologically aware in general. That makes it much harder for airlines to prioritise their profits over the environmental concerns of their paying customers.”

Just a few months before, shipping giant Orient Overseas Container Line, which has a base in Hong Kong, also announced it would stop carrying shark, whale and dolphin meat and products.

Some 91.8 per cent of Hong Kong’s shark fin imports are delivered by sea, according to the government’s Census and Statistics Department.

Hofford said a significant proportion of shipping lines which imported to the city were now shark fin free, and the amount of shark fin coming to Hong Kong had steadily declined since 2011.

“I believe most people are inherently good,” he said. “If you explain the problem to them they listen and take positive action accordingly.”

POLITICAL SENSITIVITIES

Despite recent progress made through corporate activism in Hong Kong, political sensitivities mean the city remains a place where companies are sometimes reluctant to take a stand.

Cosmetics giant Lancome faced criticism in June last year after seeming to distance itself from campaigns for Hong Kong democracy when it cancelled a concert with Canto-pop singer Denise Ho Wan-sze, herself an outspoken democracy advocate. The 39-year-old star, who has been blacklisted by mainland media, said the French company’s decision to cancel her free concert in Sheung Wan suggested it had kowtowed to external pressures.

“The world’s values have been seriously twisted when we have to be punished for seeking freedom, justice and equality, and we must face the problem seriously when an international brand like Lancome has to kneel down to this bullying hegemony,” she said.

But Lancome, which temporarily closed some of its Hong Kong stores to avoid protests, insisted the concert had been cancelled for “possible safety reasons” rather than any political issues. Ho eventually hosted the concert independently two weeks after the planned event, attracting a large audience.

CHARITABLE ACTION

Companies have found themselves under greater pressure, particularly since the 2008 financial crisis, to give back to the community. Volunteering and donating to charity now form part of the corporate culture of many large firms. Major finance, entertainment and retail companies, for example, make significant contributions to the South China Morning Post’s annual Operation Santa Claus campaign.

Global financial services company UBS was among the firms who supported that initiative this year, with staff leading specialised training programmes for some of the campaign’s 23 NGOs to advise them on how to promote their services.

Amy Lo, head of UBS wealth management and China for UBS, said it was important for the company to donate time as well as money.

“Face-to-face meetings tend to leave a powerful impression and invariably ensure the volunteers are better equipped to implement change in the community,” she said. “Another key benefit of our programme is the alumni networks that emerge. In partnership, the NGOs gain exposure to the challenges faced by peer NGOs from different fields.”

Meanwhile Credit Suisse, which supported Operation Santa Claus for the eighth consecutive year in 2016, each year collaborates with a different charity as part of its fund-raising work. Last Christmas staff met with beneficiaries of PathFinders, a charity supporting the city’s migrant mothers, many of whom are current or former domestic workers often unfairly treated by their employers.

The company’s China chief executive, Neil Harvey, said the voluntary activities of employees were not “just about PR”.

“It makes this a better place to work if people are involved in this,” he said. “It is very easy to get in your ivory tower and forget what is going on around you. I think Hong Kong corporates do particularly well in comparison with the rest of Asia.”

And Community Business says Hong Kong companies can no longer afford to ignore CSR.

“We recommend that companies look to build a sustainable business which creates a positive social impact while achieving business success,” Ngai said. “Business today has a moral dimension – to have long-term success, companies need to be ethical, take responsibility for their impact, and through their actions contribute to a better, more sustainable future.”

CORPORATE HESITATION

Internally, however, companies in Hong Kong, particularly small to medium-sized businesses, are still grappling with the concept of diversity and inclusion, Community Business claims.

In 2015, the organisation launched the Hong Kong LGBT+ Inclusion Index, but has struggled to persuade significant numbers of companies to join it.

“As reflected by the low participation rate of local Hong Kong companies back in 2015, the subject of diversity and inclusion, and in particular LGBT+ inclusion, are not well understood and recognised as important to business by local companies,” Ngai said. “We encourage local companies of all sizes to participate, and in so doing learn about what is accepted as best practice among international companies.”

Community Business says cultivating more progressive attitudes requires greater cooperation between the business community, advocacy groups and the government.

“It is our hope that Hong Kong can truly be seen as Asia’s world city in supporting LGBTI rights,” Ngai said.

Asian firms tapping into touchy subjects

In other parts of Asia, brands have found they must be careful when aligning themselves with socially and politically sensitive issues.

In December last year, Absolut Vodka was criticised for an advert depicting the historic street protests against South Korean President Park Geun-hye – currently suspended and facing impeachment over allegations of corruption – forming the shape of a bottle. The video was captioned with the phrase “The Future is Yours to Create”, suggesting South Koreans had control over the future of their country. But the video created a storm online, with some Facebook users accusing the alcohol brand of “shameless and selfish advertising”, and questioning the commercialisation of the event.

Meanwhile, Japan Airlines and its affiliate Transocean Air Company joined other businesses in declaring their support for Japan’s LGBTI community. The firm sponsored the Pink Dot festival in Okinawa, marking the first time a Japanese airline had sponsored a private LGBTI event. Tokyo Disneyland was another notable sponsor of an LGBTI event. Whether for moral or commercial reasons, they were just some of the companies tapping into the country’s LGBTI market, estimated to be worth US$50 billion.

Farther south, the Thailand Business Coalition on Aids has since 1995 seen more than 13,000 companies engage annually in strategies aimed at overcoming the country’s HIV/Aids problem. As a result, Thai companies have increasingly stepped up efforts to educate their workforce about the dangers of HIV/Aids, virus prevention and treatment. They have also adopted internal company policies for HIV/Aids prevention and awareness. The Thai corporate sector’s actions have helped to reduce the number of Thailand citizens contracting the virus. The United Nations reported that Thailand saw a 56 per cent decline in Aids-related deaths between 2005 and 2013.

Additional reporting by Cannix Yau